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Receivables and Allowance for Credit Losses
 3 Months Ended
Mar. 31, 2024
Accounts and Financing Receivable, after Allowance for Credit Loss [Abstract]  
Receivables and Allowance for Credit Losses Receivables and Allowance for Credit Losses
Notes Receivable
The Company has provided financing in the form of notes receivable loans to franchisees in order to support the development of hotel properties in strategic markets. The Company's credit quality indicator is the level of security in the note receivable.
The following table summarizes the composition of the notes receivable balances by credit quality indicator and the allowance for credit losses:
(in thousands)March 31, 2024December 31, 2023
Senior$87,055 $85,919 
Subordinated16,339 17,004 
Unsecured4,610 5,359 
Total notes receivable$108,004 $108,282 
Less: allowance for credit losses8,656 8,616 
Total notes receivable, net of allowance for credit losses$99,348 $99,666 
Current portion, net of allowance for credit losses$22,012 $20,766 
Long-term portion, net of allowance for credit losses$77,336 $78,900 
The following table summarizes the amortized cost basis of the notes receivable by the year of origination and credit quality indicator:
(in thousands)20242023202220212020PriorTotal
Senior$945 $— $— $— $— $86,110 $87,055 
Subordinated— 3,497 — — — 12,842 16,339 
Unsecured— — 194 1,291 856 2,269 4,610 
Total notes receivable$945 $3,497 $194 $1,291 $856 $101,221 $108,004 
The following table summarizes the activity related to the Company’s notes receivable allowance for credit losses:
(in thousands)March 31, 2024December 31, 2023
Beginning balance$8,616 $10,172 
Provision for credit losses690 763 
Recoveries(650)(2,319)
Ending balance$8,656 $8,616 
As of March 31, 2024 and December 31, 2023, two and one note receivable loans, respectively, with senior credit quality indicators met the definition of collateral-dependent and are collateralized by the membership interests in the borrowing entities and either the associated land parcel or the operating hotel. The Company used a discounted cash flow income approach or a market approach using quoted market prices to value the underlying collateral. The Company reviewed the borrower's financial statements, economic trends, industry projections for the market, and comparable sales capitalization rates, which represent significant inputs to the cash flow projections. These nonrecurring fair value measurements are classified as Level 3 in the fair value measurement hierarchy because they are unobservable inputs which are significant to the overall fair value. Based on the Company's analysis, the fair value of the collateral secures substantially all of the carrying value of the respective note receivable loan. The allowance for credit losses attributable to the collateral-dependent note receivable loans was $3.2 million and $2.2 million as of March 31, 2024 and December 31, 2023, respectively.
During the three months ended March 31, 2024 and during the year ended December 31, 2023, the recoveries were primarily associated with cash collections pursuant to a settlement agreement with a borrower.
The following table summarizes the past due balances by credit quality indicator of the notes receivable:
(in thousands)1- 30 days
Past Due		31-89 days
Past Due		> 90 days
Past Due		Total
Past Due		CurrentTotal
 Notes Receivable
As of March 31, 2024
Senior$— $— $15,200 $15,200 $71,855 $87,055 
Subordinated— — 2,936 2,936 13,403 16,339 
Unsecured— — 400 400 4,210 4,610 
$— $— $18,536 $18,536 $89,468 $108,004 
As of December 31, 2023
Senior$— $— $15,200 $15,200 $70,719 $85,919 
Subordinated— 2,936 — 2,936 14,068 17,004 
Unsecured— — 400 400 4,959 5,359 
$— $2,936 $15,600 $18,536 $89,746 $108,282 
The amortized cost basis of the notes receivable in a non-accrual status was $31.1 million and $15.9 million as of March 31, 2024 and December 31, 2023, respectively.
Variable Interest through Notes Receivable
The Company has issued notes receivable loans to certain entities that have created variable interests in the associated borrowers totaling $94.8 million and $95.1 million as of March 31, 2024 and December 31, 2023, respectively. The Company has determined that it is not the primary beneficiary of these variable interest entities ("VIEs"). For collateral-dependent loans, the Company has no exposure to the borrowing VIE beyond the respective note receivable and the limited commitments which are addressed in Note 12.
Accounts Receivable
Accounts receivable consists primarily of franchise and related fees due from the hotel franchisees and are recorded at the invoiced amount.
During the three months ended March 31, 2024, the Company recognized provisions for credit losses on accounts receivable of $1.1 million in selling, general and administrative expenses, and $1.6 million in other expenses from franchised and managed properties, in the consolidated statements of income. During the three months ended March 31, 2023, the Company recognized provisions for credit losses on accounts receivable of $1.8 million in selling, general and administrative expenses, and $2.1 million in other expenses from franchised and managed properties, in the consolidated statements of income. During the three months ended March 31, 2024 and 2023, the Company recorded write-offs, net of recoveries, through the accounts receivable allowance for credit losses of $1.5 million and $2.8 million, respectively.